Sunny Isles Beach, Florida, Miami, RK Centers shopping center, business sign, CVS Pharmacy retail store, drugstore chain prescription medications. (Photo by: Jeffrey Greenberg/Universal Images Group via Getty Images)
Jeff Greenberg | Universal Images Group | Getty Images
The US Federal Reserve has cut interest rates by 25 basis points, reducing borrowing costs for the third time in 2025. With lower interest rates (reducing the attractiveness of fixed income investments) and a volatile stock market, some investors may want to consider adding dividend stocks to their portfolios to ensure stable income and increase overall returns.
Stock picks from top Wall Street analysts can help investors select attractive dividend companies.
Here are three dividend stocks highlighted by Wall Street's top pros, tracked by TipRanks, a platform that ranks analysts based on their past performance.
Devon Energy
This week's first dividend pick is Devon Energy (DVN), an independent oil and natural gas exploration and production (E&P) company. In the third quarter of 2025, Devon returned $401 million to shareholders through share repurchases and dividends. The company's fixed quarterly dividend of $0.24 per share (annualized dividend of $0.96 per share) indicates a yield of 2.5%.
Recently, JP Morgan analyst Arun Jayaram upgraded Devon Energy shares from Hold to Buy, but lowered the price target to $44 from $49. TipRanks AI analyst rated DVN stock “Outperform” and set a price target of $43.
Jayaram explained that his rating upgrade was based on DVN's compelling valuation relative to its peers, supported by free cash flow gains from the company's $1 billion business optimization plan. The 5-star analyst noted that Devon had reached about 60% of its $1 billion goal in just over half a year after officially launching the plan.
The analyst noted that well productivity in Devon's Delaware Basin was negatively impacted by the Company's focus on completing a higher proportion of Wolfcamp B wells. However, Jayaram expects well productivity to remain stable in 2026 and 2027 compared to 2025 due to a “more consistent mix of secondary zones.”
Overall, Jayaram is bullish on Devon as the company has prime acreage in key parts of the Delaware Basin, Bakken and Eagle Ford shale regions. Additionally, the Company has the opportunity to expand in the STACK and Powder River Basins.
“We believe the core assets of the DVN franchise have the potential to provide a large inventory of lower-risk, high-reward development drilling opportunities, which are critical given the exhaustive nature of an E&P's asset base,” Jayaram said.
Jayaram is ranked #655 among more than 10,100 analysts tracked by TipRanks. Its valuations were profitable 59% of the time and delivered an average return of 10.3%. See Devon Energy Statistics on TipRanks.
EOG Resources
The next dividend stock is EOG Resources (EOG), an oil and gas exploration and production company with reserves in the United States and Trinidad. In the third quarter of 2025, EOG paid regular dividends of $545 million and repurchased shares worth $440 million. Last month, EOG declared a quarterly dividend of $1.02 per share, payable on January 30, 2026. With an annual dividend of $4.08, EOG's yield is 3.7%.
Gabriele Sorbara, an analyst at Siebert Williams Shank, reiterated a Buy rating on EOG shares with a price target of $150. The stock also receives an “Outperform” rating from TipRanks’ AI analyst with a price target of $127.
Sorbara views EOG as a “best-in-class” large-cap company with the ability to navigate commodity cycles, supported by its solid balance sheet and strong inventory. The analyst also noted the company's tremendous ability to generate free cash flow.
Sorbara particularly emphasized EOG's commitment to returning at least 70% of its free cash flow annually to shareholders through dividends and share repurchases. In fact, the energy company has the flexibility to return 100% of free cash flow due to its balance sheet strength.
The 5-star analyst also highlighted EOG's efforts to leverage advanced technology to pursue additional opportunities in the Delaware Basin, with the company now identifying more than nine different development targets. Among other positives, Sorbara also mentioned that EOG is ahead of its target for $150 million in first-year synergies from the Encino acquisition. Further savings are expected through factors such as improved infrastructure, production efficiencies and marketing agreements across EOG's midstream network.
Sorbara is ranked #225 among more than 10,100 analysts tracked by TipRanks. His reviews were successful 61% of the time and delivered an average return of 18.4%. See EOG resource ownership structure on TipRanks.
CVS Health
Finally, let's look at the pharmacy chain CVS Health (CVS). The company's turnaround efforts are helping to improve performance in a difficult business environment. At its investor day event on December 9, CVS Health announced positive news, stating that the company expects to achieve a compound annual growth rate (CAGR) in the adjusted teens (EPS) through 2028. With a quarterly dividend of $0.665 per share (annualized dividend of $2.66 per share), CVS stock offers a yield of 3.4%.
After Investor Day, Mizuho analyst Ann Hynes reiterated her Buy rating on CVS shares and increased her price target to $95 from $88. “CVS is our top pick in our coverage universe,” the 5-star analyst said, citing a structural improvement in retail profit guidance as the reason for her revised price target. Interestingly, TipRanks' AI analyst has a “neutral” rating on CVS with a price target of $81.
Hynes noted that CVS's mid-teens adjusted EPS CAGR target does not take into account additional share repurchases, which she said will occur once the company hits its leverage targets, possibly by the end of next year.
The analyst also highlighted the company's efforts to improve margins in the Healthcare Benefits (HCB) segment, which was under pressure due to a sustained increase in the Medical Loss Ratio (MLR). This ratio is expected to decline by approximately 50 basis points in 2026 due to better pricing, reduced benefits under Medicare Advantage (MA) plans and the company's decision to exit the Health Insurance Exchange (HIX) business.
Hynes also noted the improvement in guidance for CVS's Pharmacy and Consumer Wellness (PCW) segment, with the company now expecting flat growth in adjusted operating income compared to its previous forecast of a mid-single-digit decline. This improvement is due to market share gains, a better reimbursement environment and cost savings.
Hynes is ranked #733 among more than 10,100 analysts tracked by TipRanks. Their reviews were successful 60% of the time and delivered an average return of 8.5%. See CVS Health Options activity on TipRanks.